"The early part of the recovery has been focused on manufacturing, and we're seeing that momentum broadening out to the service sector and other parts of the economy," said Robert Dye, an economist at PNC Financial. "It looks like the pieces of a self-sustaining economic expansion are coming into place."

Yet Federal Reserve policymakers have vowed to press ahead with a $600 billion bond-buying program to stimulate the economy amid concerns that growth will remain too sluggish to quickly bring down the jobless rate.

ADP showed broad-based gains in hiring, from small businesses to large firms and from the service sector to manufacturing.

That bodes well for Friday's Labor Department employment report. Economists predict that will show public and private employers hired a net 150,000 in December, the third straight gain. The jobless rate is seen ticking down to 9.7%.

"It remains to be seen whether big jumps like that (in the ADP report) are the rule or the exception," said Mike Schenk, vice president of economics and statistics at the Credit Union National Association and Affiliates. "Our view is that labor markets will be improving, but doing so slowly."

He said the jobless rate will remain above 9% through 2011 despite his forecast for 3% economic growth. That's partly due to a skills mismatch between the jobs available and the people looking for work, he said, adding that unskilled former manufacturing and construction workers face an especially difficult job search.

ISM's new orders gauge jumped 5.3 points to 63, the best in more than four years. The prices paid subindex soared 6.8 points to 70, the highest since September 2008. But companies are having trouble passing on higher costs to cash-strapped consumers.

"Consumer prices remain well contained outside monthly fluctuations in energy and food," Dye said, adding that company profits will likely suffer due to an inability to pass higher commodity costs on to shoppers.

Shares of Family Dollar (FDO) dived 9% Wednesday after its Q1 results missed views amid rising costs and the discounter gave a weak Q2 outlook. BJ's Wholesale Club (BJ) said December sales fell short of estimates and unveiled plans to cut hundreds of jobs and close five stores by the end of this month.

Dollar Tree (NASDAQ:DLTR) gave weak second-quarter earnings guidance after its Q1 results missed Wall Street estimates and expanded store divestment plans to help clinch its Family Dollar acquisition. The deep-discount retailer also expects its acquisition of Family Dollar (NYSE:FDO) to close in ...

3D printing company 3D Systems (NYSE:DDD) replaced its CFO Friday, just six months after hiring him, sending its stock to a three-year low. 3D Systems said that it had reached a mutual separation agreement with Ted Hull, who "will leave the company in order to meet company needs and to pursue his ...

Dollar General lost out on its bid to acquire Family Dollar Stores, but Wall Street doesn't seem too worried, as the stock continues to hold near highs amid robust expansion plans. In January, Family Dollar Stores (NYSE:FDO) shareholders overwhelmingly approved Dollar Tree's (NASDAQ:DLTR) offer. It ...

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Q2 employment costs rose at the slowest pace in the 33 years the Labor Department has kept records. Costs rose just 0.2% for the quarter, taking them to a 2.0% yearly gain, from 2.6% in Q1. That's about what they've averaged since the recession ended in 2009 — compared to an average 3.6% for ...

Labor costs rose at the slowest pace on record in the second quarter, a reminder that robust growth remains elusive even as the Federal Reserve lays the groundwork for its first rate hike in nearly a decade. The Labor Department's Employment Cost Index, a measure that the Fed favors, rose 0.2%, the ...

Employment cost gains worst ever The employment cost index rose 0.2% in Q2, the lowest in the report's 33-year history. Analysts had expected a 0.6% increase after the 0.7% gain in Q1. For the year, the index was up 2%, also lower than the 2.6% notched in Q1. Wages and salaries rose 2.1% for the ...

The economy expanded at a 2.3% annual rate in the second quarter, once again falling short of projections for a decisive rebound and raising concerns that the 6-year-old expansion will never pick up steam. Q2's growth was slightly lower than expected, though Q1 was revised up to a 0.6% gain from a ...

Euro-area economic confidence hit four-year high this month, boosted by relief that Greece isn't about to give up the euro. The index of executive and consumer sentiment rose to 104 from 103.5 in June, the European Commission said Thursday. Economists' predicted a decline to 103.2, according to the ...

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